Tuesday, October 30, 2012

Students blow their loans too quickly

A recent survey uncovered some surprising, and in some cases alarming, statistics about how quickly students in the UK are getting through their student loans.

According to the survey, commissioned by discount site vouchercodes.co.uk, the average student will have used up their first loan by November 20th, a full three-and-a-half weeks before the end of the first term.

What is possibly even more concerning is that one in six students confessed that they will have blown their entire loan for the term in just 28 days!

The study sought to find out what students were spending their loans on. One in three students answered saying they regularly drank “expensive cocktails”, while another 13% surprisingly indulged in beauty treatments.

As you might expect, alcoholic drinks were the second-biggest expense on average for all students. The average overall spend worked out at £45 per month. The main offender to budgets was the weekly supermarket shop that costs £82 per month on average.

Other items that you might be surprised to see on the list include new clothes and eating out, with spending on books being fourth on the list, costing on average £30 per month. Despite their low incomes students remain a generous bunch with £23 per month going on treating friends and another £18 per month going on charitable donations.

It is also interesting to note some of the regional variations in spending habits of the UK’s students.

For example, Scottish students proved to be the most spendthrift of the lot, managing to use up their loan within a mere 43 days of the term on average. Contrast that with the careful Welsh students who made their borrowing last them a lengthy 56 days on average.

The results of this survey are based on over one thousand current university students who were asked about their spending habits, excluding tuition fee payments. The average maintenance loan (which is the means-test portion of the student loan to do with living costs as opposed to tuition fees) is £3,600 per year.

So you can tell that students have very little money to stretch out but a bit of budgeting or self-control on occasion could make their finances last longer and look healthier by the end of each term.

Another way, which has always proved popular with students is to work full –time for the summer before going away to university so you have a decent amount saved up and give your loans a bit of a buffer. This way will give any student time to adjust to living on their own and having to budget for more than just a night out once a week.

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